from the Iowa District Court for Polk County, Lawrence P.
action to enforce a judgment arising from a mechanic's
lien, defendants appeal the district court's decision
finding they waived their homestead rights. REVERSED
F. Fatino, Jonathan Kramer, and Zachary J. Hermsen of
Whitfield & Eddy, P.L.C., Des Moines, for appellants.
C. McDougal and Elizabeth R. Meyer of Davis Brown Law Firm,
Des Moines, for appellee.
by Tabor, P.J., and Mullins and Bower, JJ.
action by Standard Water Control Systems, Inc. (Standard
Water) to enforce a judgment arising from a mechanic's
lien, Michael and Cori Jones (the Joneses) appeal the
district court's decision holding they waived their
homestead rights. We affirm the district court's finding
Iowa Code section 561.21(3) (2013) does not allow a homestead
to be sold to recover attorney fees entered as part of a
judgment against a home in an action to foreclose a
mechanic's lien. We reverse the decision of the district
court on the issue of whether the Joneses waived their
homestead rights and remand for further proceedings.
Background Facts & Proceedings
the third appeal in the lawsuit between the parties. Because
the issues in this case involve a discussion of judicial
estoppel, the law of the case doctrine, and res judicata, we
must review the procedural history.
2013, the Joneses entered into a contract with Standard Water
to waterproof the basement of their home in Des Moines. While
performing the work, Standard Water struck a water line and
sewer line, causing damage to the property. The Joneses did
not permit Standard Water to complete the work. Standard
Water submitted a bill for $5400, which the Joneses refused
to pay. Standard Water filed notice of a mechanic's lien.
October 30, 2013, Standard Water filed an action against the
Joneses, seeking to foreclose the mechanic's lien under
Iowa Code chapter 572 and requested the court issue a special
execution for the sale of the property. Standard Water also
raised claims of breach of contract, quantum meruit, and
unjust enrichment. The Joneses raised several affirmative
defenses and filed counterclaims against Standard Water-none
of which involved the Joneses' homestead rights.
case was tried to the court, which found Standard Water's
actions were not a breach of duty or standard of care, and it
was entitled to foreclose the mechanic's lien. The court
entered judgment against the Joneses for $5400 plus interest.
The court determined the amount of the judgment would be
reduced by $500, to $4900, if Standard Water did not complete
the work. The court denied the Joneses' counterclaims.
district court determined Standard Water should be awarded
attorney fees. Standard Water submitted an affidavit
requesting attorney fees of $56, 014.25, plus costs. The
Joneses resisted the request for attorney fees, claiming the
amount was unreasonable in light of the amount of the
judgment and the value of the home-which had an assessed
value in 2014 of $55, 000. The district court awarded
Standard Water attorney fees of $43, 835.25 and costs of
$299.04. The court entered judgment against the Joneses and
issued a special execution for the sale of the property,
directing a sheriff's sale.
March 13, 2015, the Joneses appealed the district court's
decision. In the interim, the Joneses decided to not have
Standard Water complete the project and the district court
reduced the judgment by $500, to $4900, plus attorney fees
August 3, 2015, while the appeal was pending, Standard Water
initiated proceedings for a special execution and
sheriff's sale of the property. The notice advised the
Joneses "if the described real estate includes the
homestead . . . defendant must file a homestead plat with the
Sheriff within ten (10) days after service of this notice, or
the Sheriff will have it platted and charge the costs to this
case." See Iowa Code § 561.4, .5. The
property was sold on October 21, 2015, for $45, 000 to
Standard Water. There was no discussion of the Joneses'
homestead rights at the time of the sale.
Standard Water Control Systems, Inc. v. Jones, 888
N.W.2d 673, 677‒ 79 (Iowa Ct. App. 2016), we
determined: (1) the notice of commencement of work filed by
Standard Water was not untimely under section 572.13A; (2)
the contract did not contain an improper indemnity clause and
was not void on this ground; and (3) the award of trial
attorney fees was excessive. We vacated the award of attorney
fees and remanded to the district court for additional
fact-finding on this issue. Standard Water, 888
N.W.2d at 679.
on our decision, the Joneses filed a motion to set aside the
sheriff's sale, noting the attorney fee award, which was
a large portion of the judgment, had been vacated. Standard
Water resisted the motion to set aside the sale. In their
response to the resistance, filed on September 20, 2016, the
Joneses stated the property was their homestead. The district
court determined the sheriff's sale should be set aside.
The court stated, "Finally, this is the Jones[es]'
home and to allow the sheriff's sale to stand knowing
they cannot afford to exercise their right to redeem
effectively makes them homeless."
remand, Standard Water asked the district court to affirm its
previous award of trial attorney fees and sought $29, 144 in
appellate attorney fees and costs. Additionally, it asked the
court to reverse the order granting the motion to set aside
the sheriff's sale. The Joneses resisted Standard
Water's requests. The district court reduced the amount
of trial attorney fees to $41, 670.25. The court determined
the Joneses should pay $17, 283.44 for Standard Water's
appellate attorney fees. The court also found, "[A]ny
action with regard to the property shall proceed as if there
has not been ...